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AIM ADVISOR FLEX FUND
Supplement dated May 11, 2000
to the Prospectus dated May 1, 2000
At a meeting held on May 10, 2000, the Board of Directors of AIM Advisor Funds,
Inc. (the "company"), on behalf of AIM Advisor Flex Fund (the fund), voted to
request shareholders to approve the following items that will affect the fund:
- An Agreement and Plan of Reorganization which provides for the
reorganization of the company, which is currently a Maryland
corporation, as a Delaware business trust;
- A new advisory agreement between the company and A I M Advisors,
Inc. (AIM). The principal changes to the advisory agreement are (i)
the deletion of references to the provision of administrative
services and certain expense limitations that are no longer
applicable, and (ii) clarification of provisions relating to
delegations of responsibilities and the non-exclusive nature of
AIM's services. The revised advisory agreement does not change the
fees paid by the fund (except that the agreement permits the fund to
pay a fee to AIM in connection with investments in certain
affiliated money market funds and any new securities lending program
implemented in the future);
- Changing the fund's fundamental investment restrictions. The
proposed revisions to the fund's fundamental investment restrictions
are described in a supplement to the fund's statement of additional
information; and
- Changing the fund's investment objective and making it
non-fundamental. The investment objective of the fund would be
changed by eliminating from the investment objective the manner in
which your fund proposes to achieve its objective of a high total
return on investment. If the investment objective of the fund
becomes non-fundamental, it can be changed in the future by the
Board of Directors of the company without further approval by
shareholders. Pursuant to this proposal, the fund's investment
objective would read: "The fund's investment objective is to achieve
high total return."
The Board of Directors of the company has called a meeting of the fund's
shareholders to be held on or about September 1, 2000 to vote on these and
other proposals. Only shareholders of record as of June 23, 2000 will be
entitled to vote at the meeting. Proposals that are approved are expected to
become effective on or about September 11, 2000.
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AIM ADVISOR INTERNATIONAL VALUE FUND
Supplement dated May 11, 2000
to the Prospectus dated May 1, 2000
At a meeting held on May 10, 2000, the Board of Directors of AIM Advisor Funds,
Inc. (the "company"), on behalf of AIM Advisor International Value Fund (the
fund), voted to request shareholders to approve the following items that will
affect the fund:
- An Agreement and Plan of Reorganization which provides for the
reorganization of the company, which is currently a Maryland
corporation, as a Delaware business trust;
- A new advisory agreement between the company and A I M Advisors,
Inc. (AIM). The principal changes to the advisory agreement are (i)
the deletion of references to the provision of administrative
services and certain expense limitations that are no longer
applicable, and (ii) clarification of provisions relating to
delegations of responsibilities and the non-exclusive nature of
AIM's services. The revised advisory agreement does not change the
fees paid by the fund (except that the agreement permits the fund to
pay a fee to AIM in connection with investments in certain
affiliated money market funds and any new securities lending program
implemented in the future);
- Changing the fund's fundamental investment restrictions. The
proposed revisions to the fund's fundamental investment restrictions
are described in a supplement to the fund's statement of additional
information; and
- Changing the fund's investment objective and making it
non-fundamental. The investment objective of the fund would be
changed by eliminating from the investment objective the manner in
which your fund proposes to achieve its objective of a high total
return on investment. If the investment objective of the fund
becomes non-fundamental, it can be changed in the future by the
Board of Directors of the company without further approval by
shareholders. Pursuant to this proposal, the fund's investment
objective would read: "The fund's investment objective is to achieve
high total return."
The Board of Directors of the company has called a meeting of the fund's
shareholders to be held on or about September 1, 2000 to vote on these and
other proposals. Only shareholders of record as of June 23, 2000 will be
entitled to vote at the meeting. Proposals that are approved are expected to
become effective on or about September 11, 2000.
<PAGE> 3
AIM ADVISOR REAL ESTATE FUND
Supplement dated May 11, 2000
to the Prospectus dated May 1, 2000
At a meeting held on May 10, 2000, the Board of Directors of AIM Advisor Funds,
Inc. (the "company"), on behalf of AIM Advisor Real Estate Fund (the fund),
voted to request shareholders to approve the following items that will affect
the fund:
- An Agreement and Plan of Reorganization which provides for the
reorganization of the company, which is currently a Maryland
corporation, as a Delaware business trust;
- A new advisory agreement between the company and A I M Advisors,
Inc. (AIM). The principal changes to the advisory agreement are (i)
the deletion of references to the provision of administrative
services and certain expense limitations that are no longer
applicable, and (ii) clarification of provisions relating to
delegations of responsibilities and the non-exclusive nature of
AIM's services. The revised advisory agreement does not change the
fees paid by the fund (except that the agreement permits the fund to
pay a fee to AIM in connection with investments in certain
affiliated money market funds and any new securities lending program
implemented in the future);
- Changing the fund's fundamental investment restrictions. The
proposed revisions to the fund's fundamental investment restrictions
are described in a supplement to the fund's statement of additional
information; and
- Changing the fund's investment objective and making it
non-fundamental. The investment objective of the fund would be
changed by eliminating from the investment objective the manner in
which your fund proposes to achieve its objective of a high total
return on investment. If the investment objective of the fund
becomes non-fundamental, it can be changed in the future by the
Board of Directors of the company without further approval by
shareholders. Pursuant to this proposal, the fund's investment
objective would read: "The fund's investment objective is to achieve
high total return."
The Board of Directors of the company has called a meeting of the fund's
shareholders to be held on or about September 1, 2000 to vote on these and
other proposals. Only shareholders of record as of June 23, 2000 will be
entitled to vote at the meeting. Proposals that are approved are expected to
become effective on or about September 11, 2000.
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AIM ADVISOR FLEX FUND
AIM ADVISOR INTERNATIONAL VALUE FUND
AIM ADVISOR REAL ESTATE FUND
(Series Portfolios of AIM Advisor Funds, Inc.)
Supplement dated May 11, 2000
to the Statement of Additional Information dated May 1, 2000
At a meeting held on May 10, 2000, the Board of Directors of AIM Advisor Funds,
Inc. (the "Company"), on behalf of certain of its series portfolios (the
"Funds"), voted to request shareholder approval to amend the Funds' fundamental
investment restrictions. The Board of Directors has called a meeting of the
Funds' shareholders to be held on or about September 1, 2000. Only shareholders
of record as of June 23, 2000 are entitled to vote at the meeting. Proposals
that are approved are expected to become effective on or about September 11,
2000.
If shareholders approve the proposal to amend the Funds' fundamental investment
restrictions, each of AIM Advisor Flex Fund, AIM Advisor International Value
Fund and AIM Advisor Real Estate Fund will operate under the following
fundamental investment restrictions:
Each Fund is subject to the following investment restrictions, which may be
changed only by a vote of a majority of such Fund's outstanding shares, except
that AIM Advisor Real Estate Fund is not subject to restriction (d):
(a) The Fund is a "diversified company" as defined in the 1940 Act.
The Fund will not purchase the securities of any issuer if, as a result,
the Fund would fail to be a diversified company within the meaning of the
1940 Act, and the rules and regulations promulgated thereunder, as such
statute, rules and regulations are amended from time to time or are
interpreted from time to time by the SEC staff (collectively, the "1940
Act Laws and Interpretations") or except to the extent that the Fund may
be permitted to do so by exemptive order or similar relief (collectively,
with the 1940 Act Laws and Interpretations, the "1940 Act Laws,
Interpretations and Exemptions"). In complying with this restriction,
however, the Fund may purchase securities of other investment companies
to the extent permitted by the 1940 Act Laws, Interpretations and
Exemptions.
(b) The Fund may not borrow money or issue senior securities, except
as permitted by the 1940 Act Laws, Interpretations and Exemptions.
(c) The Fund may not underwrite the securities of other issuers.
This restriction does not prevent the Fund from engaging in transactions
involving the acquisition, disposition or resale of its portfolio
securities, regardless of whether the Fund may be considered to be an
underwriter under the Securities Act of 1933.
(d) The Fund will not make investments that will result in the
concentration (as that term may be defined or interpreted by the 1940 Act
Laws, Interpretations and Exemptions) of its investments in the
securities of issuers primarily engaged in the same industry. This
restriction does not limit the Fund's investments in (i) obligations
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities, or (ii) tax-exempt obligations issued by governments
or political subdivisions of governments. In complying with this
restriction, the Fund will not consider a bank-issued guaranty or
financial guaranty insurance as a separate security.
(e) The Fund may not purchase real estate or sell real estate unless
acquired as a result of ownership of securities or other instruments.
This restriction does not prevent the Fund from investing in issuers that
invest, deal, or otherwise engage in transactions in real estate or
interests therein, or investing in securities that are secured by real
estate or interests therein.
(f) The Fund may not purchase physical commodities or sell physical
commodities unless acquired as a result of ownership of securities or
other instruments. This restriction does not prevent the Fund from
engaging in transactions involving futures contracts and options thereon
or investing in securities that are secured by physical commodities.
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(g) The Fund may not make personal loans or loans of its assets to
persons who control or are under common control with the Fund, except to
the extent permitted by 1940 Act Laws, Interpretations and Exemptions.
This restriction does not prevent the Fund from, among other things,
purchasing debt obligations, entering into repurchase agreements, loaning
its assets to broker-dealers or institutional investors, or investing in
loans, including assignments and participation interests.
(h) The Fund may, notwithstanding any other fundamental investment
policy or limitation, invest all of its assets in the securities of a
single open-end management investment company with substantially the same
fundamental investment objectives, policies and restrictions as the Fund.
AIM Advisor Real Estate Fund will concentrate (as such term may be
defined or interpreted by the 1940 Act laws, interpretations and exemptions)
its investments in the securities of domestic and foreign real estate and
real-estate related companies.
The investment restrictions set forth above provide each of the Funds with the
ability to operate under new interpretations of the 1940 Act or pursuant to
exemptive relief from the SEC without receiving prior shareholder approval of
the change. Even though each of the Funds has this flexibility, the Board of
Directors has adopted non-fundamental restrictions for each of the Funds
relating to certain of these restrictions which the advisor must follow in
managing the Funds. Any changes to these non-fundamental restrictions, which
are set forth below, require the approval of the Board of Directors.
1. In complying with the fundamental restriction regarding issuer
diversification, the Fund will not, with respect to 75% of its total
assets, purchase securities of any issuer (other than securities
issued or guaranteed by the U.S. Government or any of its agencies
or instrumentalities), if, as a result, (i) more than 5% of the
Fund's total assets would be invested in the securities of that
issuer, or (ii) the Fund would hold more than 10% of the outstanding
voting securities of that issuer. The Fund may (i) purchase
securities of other investment companies as permitted by Section
12(d)(1) of the 1940 Act and (ii) invest its assets in securities of
other money market funds and lend money to other investment
companies and their series portfolios that have AIM or an affiliate
of AIM as an investment advisor (an "AIM Advised Fund"), subject to
the terms and conditions of any exemptive orders issued by the SEC.
2. In complying with the fundamental restriction regarding borrowing
money and issuing senior securities, the Fund may borrow money in an
amount not exceeding 33 1/3% of its total assets (including the
amount borrowed) less liabilities (other than borrowings). The Fund
may borrow from banks, broker-dealers or an AIM Advised Fund. The
Fund may not borrow for leveraging, but may borrow for temporary or
emergency purposes, in anticipation of or in response to adverse
market conditions, or for cash management purposes. The Fund may not
purchase additional securities when any borrowings from banks exceed
5% of the Fund's total assets.
3. In complying with the fundamental restriction regarding industry
concentration, the Fund may invest up to 25% of its total assets in
the securities of issuers whose principal business activities are in
the same industry (this guideline does not apply to AIM Advisor Real
Estate Fund).
4. In complying with the fundamental restriction with regard to making
loans, the Fund may lend up to 33 1/3% of its total assets and may
lend money to an AIM Advised Fund, on such terms and conditions as
the SEC may require in an exemptive order.
5. Notwithstanding the fundamental restriction with regard to investing
all assets in an open-end fund, the Fund may not invest all of its
assets in the securities of a single open-end management investment
company with the same fundamental investment objectives, policies
and restrictions as the Fund.
If a percentage restriction is adhered to at the time of investment, a later
change in percentage resulting from changes in values of assets will not be
considered a violation of the restriction.
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